UPDATE 1-Sembcorp Industries to buy UK Power Reserve for $288 mln

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(Adds detail on equity value)

LONDON, May 31 (Reuters) - Integrated energy group Sembcorp Industries has agreed to buy UK Power Reserve, Britain’s largest flexible power generator, for an equity value of 216 million pounds ($288 million).

The Singapore-listed company said on Thursday it was buying UK Power Reserve, which was founded in 2010 to meet growing demand for flexible reserve power capacity, from investment firm Equistone Partners Europe and Inflexion Private Equity.

Following the acquisition of shares, Sembcorp will consolidate all the assets and liabilities of UK Power Reserve, including its net debt.

In Britain, demand for more flexible power generation capacity has grown due to the closure of ageing thermal plants, the rise of variable renewable energy and electric vehicles.

UK Power Reserve has 32 rapid-response power stations with a total capacity of 533 megawatts (MW) in operation, enough to power 375,000 homes.

A further 480 MW of capacity, included 120 MW of battery storage assets, is under construction and development and expected to come online by 2019.

Sembcorp Industries has an energy portfolio of more than 12 gigawatts (GW) worldwide, including thermal power plants and renewable energy assets.

Sembcorp UK, which has 210 MW of combined heat and power, steam power and renewable generation capacity at its Wilton International industrial site in Teesside, northeast England, is also seeking planning approval to develop two combined-cycle gas turbine units of up to 1.7 GW at that site.